Bookmark this post, dear reader. This is historic.
Once again, Barnaby Joyce is the first major party politician (to my knowledge) to speak truth to power concerning a(nother) vital economic parameter.
In late 2009 and early 2010 – before new Opposition Leader Tony Abbott wilted like a week-old lettuce leaf and sacked him – then Opposition Finance spokesman Barnaby warned of the dangers of Australia’s rising Federal and State government debt trajectories. Only in recent weeks, some three years later, leading economists have begun to acknowledge that Barnaby was right.
Today, 7 May 2013, appearing on radio 2GB, he is the first major party politician to state that the government can bring down the exchange rate value of the Australian dollar, and tell the plain truth about why they (the ALP, Treasury, and RBA) have not done so:
The dollar, if you actually want to, you can actually affect it. It’s not written on tablets of stone and presented from Mount Sinai. You can influence the price of the dollar down if there is real motivation and desire to do so. One of the reasons they don’t do it is because they want to be economically pure. The way we’re going at the moment we’re going to be pure in debt, economically dead, so let’s make sure we keep our industry going.
Just so.
Over the past few years, our great economic leaders – the World’s Greatest Treasurer Wayne Swan, and the Million Dollar Man, RBA Governor Glenn Stevens – have deliberately chosen a policy of not joining the global currency wars. Of deliberately allowing the AUD to rise and rise versus other currencies, and to remain at unprecedented elevated levels. Why? In order to “make room for the mining boom”.
In other words, because of the inflationary impact of the mining (investment) boom, they have chosen to let a far-too-high AUD deflate the rest of the economy … to “make room for the mining boom”.
(Yes, the same mining boom that is now ending; the one that they so confidently believed would give Australia a period of “unprecedented prosperity”, a China-funded “golden age” lasting “to 2050″, according to former Treasury Secretary Ken Henry).
They have pursued an economic policy of allowing the rest of the Australian economy to be hollowed out, white-ant style, so that their precious little (bogus) economic performance figures for “inflation” (ie, the CPI) would not get too far beyond their arbitrary boundaries of preference.
While the rest of the country (except mining and related industries) has watched countless businesses, and whole industry sectors such as manufacturing, slowly getting squeezed towards, and in a record number of cases, into bankruptcy, our ivory-towered boffins have sat back applauding themselves for their ideological purity, self-congratulating for their not acting to influence the AUD exchange rate.
Despite the fact that practically every other nation in the world who can, is.
As usual, it takes the little ol’ bush accountant to bell the cat.
Barnaby for PM.
He’s the only one with both brains, and b***s.
